The wholesale prices car dealers pay at auction for the used cars they later sell rose slightly in August. That’s bad news for used car shoppers. Retail prices often follow wholesale prices, making the same adjustments after a delay of six to eight weeks.
Dealers are still paying substantially less than they did a year ago.
The Manheim Used Vehicle Value Index tracks the prices dealers pay for used cars at auction. It is a product of Kelley Blue Book parent company Cox Automotive.
Wholesale prices fell more than 11% in late spring and summer. That slide seems to have come to an end. The index now sits 7.7% lower than at the end of August 2022. But prices rose 0.2% in August from July.
“August brought a stop to wholesale price declines, though it was only a small reversal of the larger magnitude declines so far this spring and early summer,” said Chris Frey, senior manager of Economic and Industry Insights for Cox Automotive.
Automakers built about 8 million fewer cars during the pandemic. Used car inventories could remain low for years as those cars never find their way to the used market, keeping prices higher than Americans had grown accustomed to.
The story isn’t the same for every shopper, however. Compact car prices are down 13.3% year-over-year. Midsize car prices are down 12%, and luxury sedans are down 8.8%. At the other end of the scale, truck prices are down just 2.8% from one year ago.
